Superannuation Guarantee

The Superannuation Guarantee is a compulsory system of superannuation support for employees, paid by their employers. The definition of employees also includes certain contractors. This system involves an employer paying a certain percentage of the ordinary time earnings of their employees (this includes part-time and casual employees) who are aged over 18, and who are paid $450 (before tax) a month, into a complying superannuation fund or retirement savings account. The minimum contribution for 1 July 2014 is 9.5% of each employee’s earning base. This must be paid within 28 days after the end of each calendar quarter. The rate is expected to stay at 9.5% until 30 June 2018. This will then increase by 0.5% each year until it reaches 12% from 1 July 2022.

If an employer fails to make the minimum super contribution for a quarter by the due date, the employer may have to pay the Superannuation Guarantee Charge (SGC) and lodge a superannuation guarantee charge statement. If you pay late, you may be able to use the late payment either to offset the SGC or to carry forward as prepayment of a future contribution for the same employee.

The Australian Taxation Office (ATO) provides the following tools to assist in understanding and meeting you obligations: